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7/3/2008
Virginia: Toll Road Company Made Illegal Donations
Illegal campaign donations by Transurban helped secure 80-year tolling deal in Virginia.

Transurban logoAn Australian toll road company is on the hot seat for funneling $177,000 in illegal campaign cash to Virginia lawmakers since 2005. The Washington Post reported earlier today that the Federal Election Commission (FEC) is investigating the issue and that Transurban has already asked state legislators to send back any campaign checks that may have violated the law.

According to the federal regulations governing elections, "a foreign national shall not, directly or indirectly, make a contribution or a donation of money or other thing of value... in connection with any federal, state, or local election." (11 CFR 110.20).

Transurban, which is headquartered in Melbourne, made the donations to help secure the rights to toll portions of the Capital Beltway and Interstate 95. In return for contributing just $349 million of their own capital to the Beltway expansion project, Transurban earned the lucrative rights to bill Virgina drivers for at least eighty years. The rest of the project was financed with $1.6 billion in federal and state grants, loans and guarantees (details).

Many of this deal's biggest supporters were recipients of significant contributions from Transurban. Governor Tim Kaine (D) got $19,500 for his inaugural, leadership and campaign warchest. House Speaker William J. Howell (R) took $12,500 for his leadership committee. Delegate Dave Albo (R-Springfield) received just $500.

The contributions fell afoul of federal law because the FEC's definition of a foreign national includes foreign corporations. Most lawmakers were unaware of this because media reports often incorrectly refer to companies like Transurban as "Transurban USA" in the same way that red light camera vendor Redflex is called "Arizona based," suggesting they are not wholly owned and controlled by foreign corporations. Both Transurban and Redflex, for example, are listed on the Australian Stock Exchange. Each company ultimately answers to a CEO and board comprised of foreign nationals. When money flows from the foreign parent company to the US office, it becomes impossible to tell whether the foreign nationals are directly bankrolling the political donations, which is the most clear violation of federal statute in question.

US election law also makes it illegal for state lawmakers to receive such contributions knowingly. Although it is unlikely to applied in this case, FEC rules state that legislators would be liable if they were, "aware of facts that would lead a reasonable person to inquire whether the source of the funds... received is a foreign national, but the person failed to conduct a reasonable inquiry."

These lawmakers, however, will not need to return other sources of campaign cash used to secure their support for the Beltway HOT lanes. Fluor Enterprises, a ten-percent partner in the deal, gave Virginia lawmakers $242,685 in donations since 2001. Fluor is based in Dallas, Texas. Transurban has also retained the lobbying services of seven influential lobbyists who are free to make donations of their own. Lobbyist H. Benson Dendy, III, for example, has given candidates $14,932 over the years, according to the Virginia Public Access Project.

Transurban told the Post that the returned donations would be donated to charity.




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